EXHIBIT 4.2
NETRATINGS, INC.
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SECOND RESTATED STOCKHOLDERS AGREEMENT
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SEPTEMBER __, 1999
NETRATINGS, INC.
SECOND RESTATED STOCKHOLDERS AGREEMENT
THIS SECOND RESTATED STOCKHOLDERS AGREEMENT is made as of the ___ day
of September, 1999 by and among NetRatings, Inc., a Delaware corporation (the
"Company"), Hitachi, Ltd. ("Hitachi"), ▇▇▇▇▇▇▇ Media Research, Inc. ("NMR"),
Trans Cosmos U.S.A. Inc. ("TCI"), ACNielsen Corporation ("ACN") and any other
persons or entities that own 100,000 or more shares (including options to
purchase shares, whether or not exercisable) of the Company's Common Stock
received in their capacity as employees or consultants of the Company (the
"Stockholders"), and the original purchasers of the Series A Preferred Stock,
the Series B Preferred Stock, the Series C Preferred Stock and the original
purchasers of any future series of Preferred Stock of the Company on terms
approved by the Company's Board of Directors. The term "Stockholders" as
used herein means the Common Stockholders. The term "Investors" as used
herein means original purchasers of the Series A Preferred Stock, the Series
B Preferred Stock, the Series C Preferred Stock, the Series D Preferred Stock
and the original purchasers of any future series of Preferred Stock of the
Company. The term "Preferred" as used herein means the Series A Preferred
Stock, the Series B Preferred Stock, the Series C Preferred Stock, the Series
D Preferred Stock and any future series of Preferred Stock.
WHEREAS, certain Investors and the Stockholders have previously
purchased shares of the Company's Series A Preferred Stock, Series B
Preferred Stock, Series C Preferred Stock and Common Stock.
WHEREAS, certain new Investors are purchasing from the Company shares
of the Company's Series D Preferred Stock pursuant to that certain Series D
Preferred Stock Purchase Agreement of even date herewith.
WHEREAS, to induce the new Investors to purchase the Series D
Preferred Stock, the parties have agreed to enter into this Agreement.
NOW, THEREFORE, in consideration of the premises, mutual covenants and
terms hereof, the receipt and sufficiency of which is hereby acknowledged,
the parties agree as follows:
ARTICLE I
RIGHT OF FIRST REFUSAL ON STOCKHOLDER TRANSFER
1.1 COMPANY RIGHT. If at any time a Stockholder desires (or is
required) to sell or transfer in any manner any Shares (as hereinafter
defined) pursuant to the terms of a bona fide offer received from a third
party (a "Buyer"), such Stockholder shall submit a written offer to sell such
Shares (the "Offered Shares") to the Company on terms and conditions,
including price, not less favorable to the Company than those on which such
Stockholder proposes to sell such Offered Shares to such third party (the
"Offer"). The Offer shall disclose the identity of the proposed purchaser or
transferee, the number of Offered Shares, the terms of the proposed sale or
transfer and any other material facts relating to the sale or transfer.
Within ten (10) days after receipt of the Offer, the Company shall give
notice to such Stockholder of its intent to purchase
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all or some of the Offered Shares from the Stockholder on the terms and
conditions set forth in the Offer.
1.2 MAJOR INVESTORS' RIGHT. If, for any reason whatsoever, the
Company shall not exercise its right to purchase all of the Offered Shares as
provided herein, the Company shall promptly provide each Investor who then
holds not less than an aggregate of 350,000 shares of Preferred, including
any Common Stock issued upon conversion of Preferred (a "Major Investor"),
written notice (the "Notice") of same (which shall include a copy of the
written offer provided to the Company pursuant to Section 1.1 hereof), and
then each Major Investor shall have the right to purchase, on the same terms
and conditions set forth in the Offer, any or all of that portion of the
Offered Shares which the Company shall not have agreed to purchase from the
Stockholder (all such remaining shares being referred to as the "Remaining
Offered Shares"). Each Major Investor shall have the right to purchase that
number of the Remaining Offered Shares as shall be equal to the aggregate
Remaining Offered Shares multiplied by a fraction, the numerator of which is
the number of shares of Preferred (on an as-converted into Common Stock
basis), and Common Stock (which shall include unexercised warrants of NMR on
an as converted into Common Stock basis) then owned by such Major Investor
and the denominator of which is the aggregate number of shares of Preferred
(on an as-converted into Common Stock basis) and Common Stock (which shall
include unexercised warrants of NMR on an as converted into Common Stock
basis) owned by Major Investors. (Such amount of shares shall be referred to
as a Major Investor's "Right of First Refusal Pro Rata Share.") In the event
a Major Investor does not wish to purchase its Right of First Refusal Pro
Rata Share, then any Major Investor who has elected to purchase its full
Right of First Refusal Pro Rata Share shall have the right to purchase, on a
pro rata basis with any other Major Investors who so elect, any Right of
First Refusal Pro Rata Share not purchased. Each Major Investor shall act
upon the Offer as soon as practicable after receipt from the Company of the
Notice and in all events within fifteen (15) days after receipt thereof.
Each Major Investor shall have the right to accept the Offer as to all or
part of the Remaining Offered Shares offered thereby. If, as a result, the
number of Shares accepted by the Major Investors shall exceed the number of
Remaining Offered Shares so offered, the oversubscribing Major Investors
shall be cut back with respect to their oversubscriptions on a pro rata basis
in accordance with their respective Right of First Refusal Pro Rata Shares or
as they may otherwise agree among themselves.
1.3 AGGREGATION. For the purposes of this Article I and Article II
below, the number of shares of Preferred and/or Common Stock issued upon
conversion of Preferred shall include the holdings of affiliates and
transferees and assignees of a partnership (who are partners or retired
partners of such partnership) and of a corporation (who are subsidiaries or
parents or shareholders of such corporation or which have the same parent
corporation as a Major Investor) and such holdings shall be aggregated
together and with the partnership or corporation, as the case may be.
1.4 ALL OR NONE. If the Company and the Major Investors, taken
together, do not elect to purchase all of the Offered Shares, then there
shall be no right to purchase shares pursuant to this Section.
1.5 FAILURE TO EXERCISE RIGHTS. In the event that the Company and
Major Investors, taken together, do not purchase all of the Offered Shares
pursuant to and within time periods set
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forth above, the Offered Shares may be sold or transferred by such
Stockholder at any time within 90 days thereafter, subject to the
requirements of Article II below. Such 90-day period shall not commence
until the rights of the Major Investors under Article II have been resolved
in accordance with the terms thereof. Any sale or transfer of Offered Shares
under this Article I shall be at not less than the price nor upon other terms
and conditions, if any, more favorable to the purchaser or transferee than
those specified in the Offer. Any Offered Shares not sold within such 90-day
period shall thereafter again be subject to the requirements of this Article
I. In the event that Shares are sold or transferred to any Investor pursuant
to this subsection, said Offered Shares shall no longer be subject to this
Agreement.
1.6 TRANSFER OF RIGHTS. The right of a Major Investor to purchase
Offered Shares hereunder may not be assigned except to a transferee or
assignee who qualifies as a "Major Investor" as defined herein.
1.7 PROHIBITED TRANSFERS. The Stockholders shall not sell, assign,
transfer, pledge, hypothecate, mortgage or dispose of, by gift or otherwise,
or in any way encumber, all or any part of the Shares owned by them during
the term of this Agreement other than in compliance with the terms of this
Article I.
1.8 DEFINITION OF "SHARES". For purposes of this Article I, the
term "Shares" shall mean and include all shares of Common Stock of the
Company owned by the Stockholders, whether presently held or hereafter
acquired.
1.9 PERMITTED TRANSFERS. The right of first refusal contained in
this Agreement shall not apply to: (a) any transfer of Shares by a
Stockholder by gift or bequest or through inheritance to, or for the benefit
of, any ancestor, descendant or spouse; (b) any transfer of Shares by a
Stockholder to its partners in the case that the Stockholder is itself a
partnership; (c) any transfer of Shares by a Stockholder to a trust for the
benefit of any ancestor, descendant or spouse; (d) any sale or transfer of
Shares to the Company (or any assignee of the Company) pursuant to the terms
of a stock restriction or stock repurchase agreement (which provides for such
sale upon the Stockholder's termination of employment); (e) any transfer to
the Company or a Major Investor pursuant hereto; (f) any sale of Common Stock
in a public offering pursuant to a registration statement filed by the
Company with the Securities and Exchange Commission; (g) any transfer of
Shares between Hitachi and a subsidiary of Hitachi; or (h) any transfer of
Shares by a Stockholder to an "Affiliate" (as such term is defined in Rule
12b-2 under the Securities Exchange Act of 1934, as amended). In the event
of any transfer pursuant to (a), (b), (g) or (h), the transferee of the
Shares shall hold the Shares so acquired with all the rights conferred by,
and subject to all the restrictions imposed by, this Agreement.
ARTICLE II
RIGHT OF CO-SALE REFUSAL ON STOCKHOLDER TRANSFER
2.1 RIGHT OF CO-SALE. In the event that any Stockholder desires
(or is required) to sell or transfer in any manner any Shares (as hereinafter
defined) pursuant to the terms of a bona fide offer received from a Buyer,
and the Company and each of the Major Investors do not exercise their right
of first refusal in full as set forth in Article I hereof, the Major
Investors shall have the
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right (the "Right of Co-Sale") to require, as a condition to such sale or
transfer, that the Buyer purchase from such Major Investors at the same price
per share and on the same terms and conditions as involved in such sale or
disposition by the Stockholder that percentage of the Offered Shares
expressed by a fraction, the numerator of which is the number of shares of
Preferred (on an as-converted into Common Stock basis) and Common Stock
(which shall include unexercised warrants of NMR on an as converted into
Common Stock basis) then owned by such Major Investor and the denominator of
which is the aggregate number of shares of Preferred (on an as-converted into
Common Stock basis) and Common Stock then outstanding (which shall include
unexercised warrants of NMR on an as converted into Common Stock basis) (such
percentage shall be referred to as a Major Investor's "Co-Sale Pro Rata
Percentage"). Each Major Investor shall act upon the Buyer's offer to buy as
soon as practicable after receipt from the Company of the Notice and in all
events within fifteen (15) days after receipt of the Notice. In the event
that one or more Major Investors shall elect to exercise its Right of
Co-Sale, each such Major Investor shall communicate in writing such election
to the selling Stockholder.
2.2 PROHIBITED TRANSFERS. The Stockholders shall not sell, assign,
transfer, pledge, hypothecate, mortgage or dispose of, by gift or otherwise,
or in any way encumber, all or any part of the Shares (as hereinafter
defined) owned by them during the term of this Agreement other than in
compliance with the terms of this Agreement.
2.3 DEFINITION OF "SHARES". For purposes of this Article II, the
term "Shares" shall mean and include all shares of Common Stock of the
Company owned by the Stockholders, whether presently held or hereafter
acquired.
2.4 PERMITTED TRANSFERS. The Right of Co-Sale contained in this
Agreement shall not apply to: (a) any transfer of Shares by a Stockholder by
gift or bequest or through inheritance to, or for the benefit of, any spouse,
ancestor or descendant; (b) any transfer of Shares by a Stockholder to a
trust for the benefit of any spouse, ancestor or descendant; (c) any sale or
transfer of Shares to the Company pursuant to the terms of a stock
restriction or stock repurchase agreement (which provides for such sale upon
the Stockholder's termination of employment); (d) any transfer of Shares to
the Company or any Major Investor pursuant to the provisions of Article I
hereof; (e) any sale of Common Stock in a public offering pursuant to a
registration statement filed by the Company with the Securities and Exchange
Commission; (f) any transfer of Shares between Hitachi and a subsidiary of
Hitachi or subsequent transfer among the Hitachi group companies; or (g) any
transfer of Shares by a Stockholder to an "Affiliate" (as such term is
defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended).
In the event of any transfer pursuant to (a), (b), (f) or (g), the
transferee of the Shares shall hold the Shares so acquired with all the
rights conferred by, and subject to all the restrictions imposed by, this
Agreement.
ARTICLE III
TERMINATION OF STOCKHOLDER RIGHTS
The Right of First Refusal and Co-Sale Rights created under Articles I
and II of this Agreement respectively, shall expire upon the first to occur of
the following: (i) the closing of
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the first public offering of the Common Stock of the Company to the general
public which is effected pursuant to a registration statement filed with, and
declared effective by, the Securities and Exchange Commission under the
Securities Act of 1933, as amended, pursuant to which the Preferred would be
converted into Common Stock under the terms of the Company's Certificate of
Incorporation (the "IPO Closing Date"); (ii) as to any Major Investor, at
such time as such Major Investor no longer holds 350,000 shares of Preferred
and/or Common Stock issued upon conversion of Preferred (appropriately
adjusted for stock splits, stock dividends, recapitalizations and the like);
and (iii) September 30, 2013.
ARTICLE IV
SPECIFIC PERFORMANCE
The rights of the parties under this Agreement are unique and,
accordingly, the parties shall, in addition to such other remedies as may be
available to any of them at law or in equity, have the right to enforce their
rights hereunder by actions for specific performance to the extent permitted
by law.
ARTICLE V
LEGENDS
The certificates representing the Shares shall bear on their face a
legend indicating the existence of the restrictions imposed by this
Agreement. Nothing in this Agreement should be construed as a modification or
amendment of any restrictions on transfer under applicable federal or state
securities laws.
ARTICLE VI
ELECTION OF DIRECTORS
As long as Trans Cosmos U.S.A. Inc. ("TCI") or any "Affiliate"
(as such term is defined in Rule 12b 2 under the Securities Exchange Act of
1934, as amended) of TCI holds at least 1,764,000 shares of Series C
Preferred Stock, the parties under this Agreement agree to cast their votes
in favor of one (1) candidate for director nominated by TCI or, if the
required number of shares is held by an Affiliate of TCI, such Affiliate.
ARTICLE VII
GENERAL PROVISIONS
7.1 GOVERNING LAW. This Agreement shall be governed by the laws of
the State of California without regard to choice of law provisions thereof,
and by the General Corporation Law of the State of Delaware to the extent
applicable to any corporate action related to the Company.
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7.2 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior oral or written agreements and understandings between
them or any of them as to such subject matter.
7.3 AMENDMENT. Except as otherwise expressly provided herein, this
Agreement may be amended only upon the written consent of the Stockholder
against whom this Agreement is sought to be enforced, the Company, and
Investors representing not less than a majority-in-interest of each series of
Preferred then held by the Investors.
7.4 SUCCESSORS. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective heirs,
executors, legal representatives, successors, and permitted transferees,
except as may be expressly provided otherwise herein.
7.5 INVALIDITY OF PROVISIONS. In the case any one or more of the
provisions contained in this Agreement shall for any reason to be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other provision of this Agreement
and such invalid, illegal and unenforceable provision shall be reformed and
construed so that it will be valid, legal, and enforceable to the maximum
extent permitted by law.
7.6 NOTICE. All notices and other communications required or
permitted under this Agreement shall be mailed by registered or certified
mail, postage prepaid, or otherwise delivered by hand or by messenger,
addressed (a) if to a Stockholder or Investor, at such Stockholder's or
Investor's address as such Stockholder or Investor shall have furnished to
the Company in writing, or (b) if to the Company, one copy should be sent to
its offices and addressed to the attention of the President, or at such other
address as the Company shall have furnished to the Investor.
Each such notice or other communication shall for all purposes of this
Agreement be treated as effective or having been given when delivered if
delivered personally, or, if sent by mail, at the earlier of its receipt or
72 hours after the same has been deposited in a regularly maintained
receptacle for the deposit of the United States mail, addressed and postage
prepaid as aforesaid.
7.7 NO WAIVER. Either party's failure to enforce any provision or
provisions of this Agreement shall not in any way be construed as a waiver of
any such provision or provisions, nor prevent that party thereafter from
enforcing each and every other provision of this Agreement. The rights
granted to the parties herein are cumulative and shall not constitute a
waiver of any party's right to assert all other legal remedies available to
it under the circumstances.
7.8 CONSIDERATION. The Stockholders agree upon request to execute
any further documents or instruments necessary or desirable to carry out the
purposes or intent of this Agreement.
7.9 ADDITION OF PARTIES. The Company agrees that until the
termination of this Agreement, it will cause each person employed by it or by
any subsidiary of the Company who holds 100,000 or more shares of the Common
Stock of the Company, to enter into this Agreement and thereby to be bound by
the terms hereof, all by execution of an instrument of
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accession in appropriate form. Any such person so entering into this
Agreement shall be deemed to be a Stockholder for purposes of this Agreement.
7.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
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[SECOND RESTATED STOCKHOLDERS AGREEMENT]
The foregoing Stockholders Agreement is hereby executed as of the day
and year first written above.
"COMPANY" NETRATINGS, INC.,
a Delaware corporation
By:
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▇▇▇▇▇ ▇. ▇▇▇▇, President
"INVESTORS" HITACHI, LTD.
By:
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Name:
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Title:
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TRANS COSMOS U.S.A. INC.
By:
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Name:
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Title:
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ACNIELSEN CORPORATION
By:
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Name:
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Title:
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▇▇▇▇▇▇▇ MEDIA RESEARCH, INC.
By:
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Name:
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Title:
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SIGNATURE PAGE OF THE STOCKHOLDERS AGREEMENT
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"INVESTORS" (con't)
SWISS FAMILY ▇▇▇▇▇ LIMITED
By:
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▇▇▇▇▇ ▇▇▇▇
Title:
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Ling Chow ▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Liangfu Fan ▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ III ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
KINETECH, INC. ------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇
By:
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Title:
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇▇
SIGNATURE PAGE OF THE STOCKHOLDERS AGREEMENT
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By:
"STOCKHOLDERS" ---------------------------------
Name:
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By:
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Name:
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By:
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Name:
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By:
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Name:
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NETRATINGS, INC.
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ADDENDUM NO. 1 TO SECOND RESTATED STOCKHOLDERS AGREEMENT
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SEPTEMBER _____, 1999
NETRATINGS, INC.
ADDENDUM NO. 1 TO SECOND RESTATED
STOCKHOLDERS AGREEMENT
THIS ADDENDUM NO. 1 TO SECOND RESTATED STOCKHOLDERS AGREEMENT (the
"Addendum") is made and entered into as of the _____ day of September, 1999 by
and among NetRatings, Inc., a Delaware corporation (the "Company"), Hitachi,
Ltd. ("Hitachi"), and any other persons or entities that own 100,000 or more
shares (including options to purchase shares, whether or not exercisable) of the
Company's Common Stock received in their capacity as employees or consultants of
the Company, and the original purchasers of the Series A Preferred Stock, the
Series B Preferred Stock, the Series C Preferred Stock, the Series D Preferred
Stock and the original purchasers of any future series of Preferred Stock of the
Company on terms approved by the Company's Board of Directors. The term
"Investors" as used herein means original purchasers of the Series A Preferred
Stock, the Series B Preferred Stock, the Series C Preferred Stock (consisting of
▇▇▇▇▇▇▇ Media Research, Inc. ("NMR") and Trans Cosmos U.S.A. Inc. ("TCI")), the
Series D Preferred Stock (consisting of ACNielsen Corporation ("ACN"), NMR and
TCI) and the original purchasers of any future series of Preferred Stock of the
Company. The term "Series Preferred" as used herein means the Series A Preferred
Stock, the Series B Preferred Stock, the Series C Preferred Stock, the Series D
Preferred Stock and any future series of Preferred Stock. The holders of Common
Stock and Series Preferred who are parties to this Agreement are referred to
herein as the "Stockholders."
NOW, THEREFORE, in consideration of the premises, mutual covenants and
terms hereof, and for other valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties agree as follows:
ARTICLE I
DEFINITIONS
The following terms used in this Addendum, unless otherwise expressly
provided herein, shall have the following meanings. Capitalized terms not
otherwise defined herein shall have the meaning set forth in the Second Restated
Stockholders Agreement.
1.1 "AFFILIATE" shall mean a person or entity that controls, is controlled
by or is under common control with another person. For purposes of this
Agreement, "control" shall mean direct or indirect ownership of more than 50% of
the voting interest or income interest in a person or entity, or such other
relationship as, in fact, constitutes actual control.
1.2 "APPRAISED VALUE OF THE COMPANY" shall mean the fair market value of
the Company as of any relevant measurement date hereunder, as determined (i) by
two investment banking firms of national reputation, one selected by the Company
and the other selected by NMR, or (ii) if a value cannot be agreed upon by such
two investment banking firms or by mutual agreement of the Company and NMR, by a
third investment banking firm selected by the other two investment banking firms
and acceptable to both NMR and the Company, provided
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that, if the value determined by such third investment banking firm does not
fall between the values determined by the initial two investment banking firms,
then the "Appraised Value of the Company" shall be the average of the values
determined by the initial two investment banking firms.
1.3 "BUYOUT DECISION DATE" shall have the meaning set forth in Section
6.1(c)(ii).
1.4 "BUYOUT DECISION NOTICE" shall have the meaning set forth in Section
3.3.
1.5 "BUYOUT NOTICE" shall have the meaning set forth in Section 3.3.
1.6 "BYLAWS" shall mean the Bylaws of the Company as in effect on the date
hereof and as the same may be amended from time to time as permitted by this
Addendum.
1.7 "COMMON STOCK" shall mean the common stock, par value $0.001 per share,
of the Company or any successor class of common stock of the Company.
1.8 "COMPANY-IPO" shall mean the initial registration by the Company of
shares of Common Stock pursuant to a registration statement filed under the
Securities Act for purposes of effecting an initial public offering of such
shares of Common Stock.
1.9 "COMPANY PROPRIETARY SOFTWARE" shall mean all computer software
programs owned by the Company as of the date hereof or at any time during the
term of this Agreement, and all Updates (as defined in the Operating Agreement)
thereto, for providing the Approved Internet Service (as defined in the
Operating Agreement). Company Proprietary Software excludes any Software that
the Company licenses from Third Parties for use with the Company Proprietary
Software.
1.10 "COMPANY SALE EVENT" shall mean any of the following: (i) any
dissolution or liquidation of the Company or any sale or transfer of all or
substantially all of the consolidated assets of the Company and its Affiliates
to any Third Party or any other transaction having a similar effect, whether in
a single transaction or a series of transactions, it being the agreement of the
Parties that, without limiting the foregoing, any sale or transfer of any
material portion of the Company Proprietary Software to any Third Party (other
than sales or transfers in the ordinary course, which may include exclusive
licenses granted to one or more third parties in one or more jurisdictions)
shall be deemed to constitute a sale of substantially all of the consolidated
assets of the Company and its Affiliates for purposes of this Addendum; or (ii)
any merger, consolidation, reorganization, recapitalization or liquidation
between any Third Party and the Company or an Affiliate which owns all or
substantially all of the assets of the Company, whether or not the Company or
such Affiliate is the surviving or disappearing corporation in any such
transaction.
1.11 "COMPANY SECURITIES" shall mean the Common Stock, the Series Preferred
and all other existing and future classes of equity securities of the Company,
together with all options, warrants, rights, notes or other instruments
convertible into, exchangeable for or exercisable for such Common Stock, Series
Preferred or other equity securities of the Company.
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1.12 "FIRST WARRANT" shall mean the Common Stock Purchase Warrant dated
August 15, 1999 herewith pursuant to which NMR has the right, under certain
circumstances, to purchase 1,106,109 shares of Common Stock, in the form
attached as EXHIBIT A hereto.
1.13 "INTELLECTUAL PROPERTY RIGHTS" shall mean all worldwide right, title
and interest of a Person in, to and under any and all: (i) United States and
foreign patents and pending patent applications therefor, including the right to
file new and additional patent applications based thereon, including
provisionals, divisionals, continuations, continuations-in-part, reissues and
reexaminations; (ii) copyrights; and (iii) trade secrets, know-how, processes,
methods, engineering data and technical information.
1.14 "LOOKBACK PERIOD" shall have the meaning set forth in Section 3.3.
1.15 "NMR BUYOUT EVENT" shall mean any transaction or series of
transactions pursuant to which NMR acquires, for cash or securities, whether by
means of an acquisition of shares of capital stock or a merger, consolidation or
similar business combination or an acquisition of assets, 100% of all equity
interests in the Company not then owned by NMR or all or substantially all of
the assets, business and operations of the Company, as applicable. In the
absence of mutual written agreement of NMR and the Company to the contrary, "NMR
Buyout Event" shall mean an acquisition by NMR of 100% of all equity interests
in the Company.
1.16 "NMR WARRANTS" shall mean the First Warrant and the Second Warrant.
1.17 "RESTATED CERTIFICATE" shall mean the Fourth Restated Certificate of
Incorporation of the Company, as filed with the Secretary of State of Delaware
on September _____, 1999.
1.18 "SECOND WARRANT" shall mean the Common Stock Purchase Warrant dated
August 15, 1999 herewith pursuant to which NMR has the right, under certain
circumstances, to purchase 12,000,000 shares of the Common Stock, in the form
attached as EXHIBIT B hereto.
1.19 "THIRD PARTY" shall mean, with respect to a party, any person that is
not an Affiliate of such party.
ARTICLE II
BOARD REPRESENTATION
2.1 BOARD REPRESENTATION.
(a) The rights granted to NMR and ACN under this Article II with
respect to representation on the Board shall apply for so long as NMR and its
Affiliates, and ACN and its Affiliates, beneficially own at least 5.0% and 10%,
respectively, of the issued and outstanding shares of Common Stock on a
fully-diluted basis (as defined in Section 4.1(a) below).
(b) The Company and NMR have agreed that, effective as of August 15,
1999 hereof, the Company shall increase the size of the Board from four to five
members and NMR
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shall have the right to nominate one representative to the Board. Immediately
upon NMR's exercise in full of the Second Warrant, the Company agrees to
increase the size of the Board by one member and NMR shall have the right to
nominate an aggregate of two representatives to the Board (such individual(s),
together with all future NMR appointees to the Board, being referred to herein
as the "NMR Director(s)"). After the effectiveness of the registration statement
relating to a Company-IPO, the Company shall use its best efforts to appoint
such additional nominee to the Board of Directors pending the next meeting of
stockholders, subject, however, to any fiduciary duties of the Board and
compliance with the Restated Certificate and the Bylaws.
The Company and ACN have agreed that, effective as of September _____,
1999 hereof, the Company shall increase the size of the Board from five members
to six members and ACN shall have the right to nominate one representative to
the Board.
(c) The Company has duly and validly taken all corporate actions
necessary to increase the size of the Board from four to five members and, upon
notice from NMR, shall appoint an individual to be designated by NMR to such
vacancy in the Board. The Company has duly and validly taken all corporate
actions necessary to increase the size of the Board from five to six members
and, upon notice from ACN, shall appoint an individual to be designated by ACN
to such vacancy in the Board.
(d) Each of the Stockholders hereby irrevocably agrees to vote all
Company Securities now or hereafter owned by such Stockholder in favor of
electing (or re-electing, as the case may be) the NMR Directors and/or NMR's
nominees, and ACN Director or ACN nominee, to the Board, as the case may be, and
to take all such action as may be necessary to enable NMR and ACN to exercise
its rights to Board representation as provided in this Article II, including,
without limitation, voting in favor of any amendment of the Bylaws to increase
the size of the Board. Each of the Stockholders hereby further agrees to use all
reasonable efforts to cause any Director nominated by such Stockholder to vote
at any meeting of the Board in favor of NMR's nominees or ACN nominee to the
Board or otherwise and to take all such action as may be necessary to enable NMR
and ACN to exercise its rights to Board representation as provided in this
Article II, including, without limitation, to permit the election or designation
to the Board of such number of NMR Directors and an ACN Director to which NMR
and ACN, respectively, are entitled under this Addendum. The provisions of this
Section 2.1(d) shall expire upon the effectiveness of the registration statement
relating to a Company-IPO.
(e) After the effectiveness of the registration statement relating to
a Company-IPO, NMR shall continue to have the right to designate the number of
nominees to the Board specified under Section 2.1(b) above. The Company agrees
to nominate such individual(s) as management's nominees at each regularly
scheduled annual stockholders meeting or any special meeting of stockholders at
which the election of directors shall take place, to recommend to the
stockholders at such meeting such individual's election to the Board and
otherwise to use all reasonable efforts to cause the election of such nominee(s)
to the Board.
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2.2 INCREASE IN NUMBER OF DIRECTORS; VACANCIES.
(a) The Company and NMR have agreed that, except for the increases in
the size of the Board provided for in Section 2.1(b) above, until the
effectiveness of the registration statement relating to a Company-IPO, no
further changes in the size of the Board shall be made without the consent of
NMR.
(b) If any NMR Director resigns after his/her election to the Board,
is removed or is otherwise unable to serve for any reason prior to the
expiration of his term as a Director, NMR or the remaining NMR Director, if any,
shall notify the Board thereof. NMR shall have the right to designate the
individual who will fill such vacancy as an NMR Director. After the
effectiveness of the registration statement relating to a Company-IPO, the
Company shall use its best efforts to appoint such replacement director to the
Board pending the next meeting of stockholders, subject to any fiduciary duties
of the Board and compliance with the Restated Certificate and the Bylaws.
ARTICLE III
COMPANY-IPO; NO-SALE PERIOD
3.1 COMPANY-IPO. The parties hereby agree that the Company shall have the
right to engage in a Company-IPO at any time from and after the date hereof and
that any such Company-IPO shall not constitute a Company Sale Event for purposes
of this Addendum.
3.2 NO-SALE PERIOD. The Company agrees that it will not (whether
through the Board, executive management or otherwise), during the period from
the date hereof until the fifth anniversary of the date hereof (the "No-Sale
Period"), engage in, solicit proposals for or otherwise seek to engage in or
make any proposals with respect to any Company Sale Event without the prior
written consent of NMR. Notwithstanding the foregoing, the parties agree that
the No-Sale Period shall terminate upon the effectiveness of the registration
statement relating to a Company-IPO or at such time as NMR and its Affiliates
cease to beneficially own at least 5.0% of the issued and outstanding shares of
Common Stock on a fully-diluted basis (as defined in Section 4.1(a) below),
whichever occurs earlier. Subject to NMR's rights under Section 4.4, none of the
Stockholders shall have the right to make any proposal to the Company (or to any
of the stockholders, officers or directors of the Company) with respect to any
Company Sale Event during the No-Sale Period.
3.3 POST-NO-SALE PERIOD.
(a) At any time from and after the termination or expiration of the
No-Sale Period, the Company shall have the right to seek to engage in a Company
Sale Event, subject to the first refusal rights granted to NMR under provisions
of this Section 3.3.
(b) If the Company wishes to pursue a Company Sale Event, it shall
first submit an Initial Valuation to NMR for its consideration. Such "Initial
Valuation" may consist of any valuation of the estimated fair market value of
the Company as may be acceptable to the Board, including, without limitation,
any valuation prepared by or with the assistance of an
5
investment banking firm retained by the Company at its expense. Within 30 days
of its receipt of such Initial Valuation, NMR shall have the right (in the
absence of mutual agreement with NMR with respect to valuation) to request that
a valuation of the fair market value of the Company be determined by an
investment banking firm selected by NMR at its expense. Such valuation shall, to
the extent practicable, be prepared within 45 days of the appointment of such
firm. If NMR and the Company cannot agree on the fair market value of the
Company after preparation of such valuation, either party shall have the right
to request that such value be determined by a second investment banking firm
selected by the initial investment banking firm and acceptable to both of the
parties. The value determined by such second investment banking firm shall be
referred to as the "Stipulated Buyout Value," provided that, if the value
determined by such second investment banking firm does not fall between the
values determined by the Company and the first investment banking firm, then the
"Stipulated Buyout Value" shall be the average of the values determined by the
Company and NMR's investment banking firm. The Company shall provide such
documents, data and assistance as may be reasonably requested by such investment
banking firms. The fees and expenses of such second investment banking firm
shall be shared equally by the Company and NMR.
(c) Upon final determination of the Stipulated Buyout Value (or mutual
agreement of the Company and NMR on valuation), the Company shall have the right
to propose in writing (the "Notification") that NMR complete an NMR Buyout Event
at the Stipulated Buyout Value within 30 days of the date of such Notification
(the "Notification Period"). If the Company elects not to submit a Notification
as aforesaid (or if the Company abandons the foregoing appraisal process at any
time), then the Company shall not thereafter propose a Company Sale Event
without again complying with the requirements of this Section 3.3. If the
Company submits a Notification as aforesaid, NMR shall have the right, but not
the obligation, to complete an NMR Buyout Event at the Stipulated Buyout Value
by submitting a written notice (a "Buyout Decision Notice") to the Company prior
to the expiration of the Notification Period. If NMR elects not to proceed with
an NMR Buyout Event, it shall deliver a negative Buyout Decision Notice to the
Company prior to the expiration of the Notification Period. The date on which
any positive or negative Buyout Decision Notice is delivered by NMR is referred
to as the "Buyout Decision Date". If NMR elects to proceed with such NMR Buyout
Event, the closing of the NMR Buyout Event will occur within 30 days of the
positive Buyout Decision Date or as soon as practicable thereafter to the extent
necessary in order to comply with all regulatory filings and clearances.
(d) If NMR elects not to proceed with such NMR Buyout Event, the
Company shall then have the right to complete a Company Sale Event with any
person other than NMR during the Lookback Period for a purchase price equal to
or greater than the Stipulated Buyout Value; provided, however, that if the
Company does not complete such Company Sale Event within the Lookback Period,
then any Company Sale Event that the Company may thereafter wish to propose
shall be subject to the requirements of this Section 3.3. For purposes hereof,
the "Lookback Period" shall mean the six-month period following any negative
Buyout Decision Date.
(e) If the Company wishes to engage in a Company Sale Event with a
person other than NMR during the Lookback Period at a purchase price less than
the Stipulated Buyout Value, the Company shall give written notice to NMR. NMR
shall have the right for a period of
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30 days after its receipt of such notice to elect, by written notice to the
Company, to effect an NMR Buyout Event at such lower purchase price. If NMR
elects to proceed with such NMR Buyout Event, the closing of the NMR Buyout
Event will occur within 30 days of the delivery of such written notice to the
Company or as soon as practicable thereafter to the extent necessary in order to
comply with all regulatory filings and clearances. If NMR elects not to proceed
with such NMR Buyout Event, then the Company shall have the right to complete
the relevant Company Sale Event on any terms in its discretion; provided,
however, that if the Company does not complete such Company Sale Event within
six months from the date of NMR's election not to proceed, then the provisions
of this Section 3.3 shall apply DE NOVO with respect to any other Company Sale
Event that the Company proposes to undertake thereafter.
(f) Each of the Stockholders agrees to vote all shares of Company
Securities owned by them in favor of any NMR Buyout Event proposed to be
effected under and in accordance with the provisions of this Section 3.3. Such
Stockholders further agree to sell all Company Securities owned by each of them
to NMR in connection with any such transaction if requested by NMR as provided
in Section 3.3(c).
(g) If requested by the Company or NMR to accommodate their respective
tax or other planning objectives, the Company and NMR agree to engage in good
faith discussions concerning the possible substitution of shares of NMR for cash
for a portion of the relevant purchase price in an NMR Buyout Event in order to
enable the transaction (or a portion thereof) to qualify as a tax-free
reorganization; provided, however, that neither party shall be under any legally
binding obligation to agree to any such alternative transaction forms.
3.4 NO INCONSISTENT ACTIVITIES. During the No-Sale Period, the Company
will not, and will direct its officers, directors and other representatives (and
their representatives on the Board) not to, solicit, negotiate or accept any
offer from any Third Party concerning any Company Sale Event.
3.5 TERMINATION. The rights and restrictions of the parties under this
Article III shall terminate upon the effectiveness of the registration statement
relating to a Company-IPO or at such time as NMR and its Affiliates cease to own
at least 5.0% of the issued and outstanding shares of Common Stock on a
fully-diluted basis (as defined below).
ARTICLE IV
OTHER RIGHTS AND RESTRICTIONS
4.1 APPROVAL OF CERTAIN TRANSACTIONS. (a) In addition to any favorable
vote of stockholders required under the Restated Certificate and Bylaws or
applicable law, prior to the effectiveness of the registration statement
relating to a Company-IPO, and for so long as NMR and its Affiliates
beneficially own at least 5.0% and ACN and its Affiliates beneficially own at
least 10.0% of the issued and outstanding shares of Common Stock on a
fully-diluted basis (i.e., based on the assumption that all options, warrants or
other convertible securities or instruments or other rights to acquire Common
Stock or any other existing or future classes of capital stock have been
exercised or converted, as applicable, in full, regardless of whether any such
options,
7
warrants, convertible securities or instruments or other rights are then vested
or exercisable or convertible in accordance with their terms), the following
transactions shall not be deemed to be approved by the Board unless the
affirmative Board votes described below have been obtained:
(i) In the case of any acquisition or purchase by the Company of
another business or entity (whether by means of a purchase of stock,
assets, merger or similar transaction) in which the aggregate consideration
payable by the Company exceeds $5.0 million, such transaction shall require
a majority vote of the Board of Directors which shall include at least two
out of the three independent directors on the Board.
(ii) In the case of any sale or other issuance of securities by
the Company as part of any transaction or series of transactions which
would be required to be integrated under Regulation D under the Securities
Act of 1933, which results in the issuance of securities representing in
excess of 25% of the issued and outstanding shares of Common Stock on a
fully-diluted basis (as defined in this Section 4.1(a)) at such time, such
transaction shall require a majority vote of the Board of Directors which
shall include the NMR and ACN Director(s).
(b) Each of the Stockholders hereby agree to vote his/her shares in
favor of an amendment to the Restated Certificate increasing the authorized
share capital of the Company to permit the exercise of the NMR Warrants by NMR.
4.2 RESTRICTION ON HOLDINGS BY OTHER STOCKHOLDERS.
(a) For so long as NMR and its Affiliates beneficially own at least
5.0% of the issued and outstanding shares of Common Stock on a fully-diluted
basis (as defined in Section 4.1(a) above), the parties agree that no future
holder of any Company Securities shall be permitted at any time to beneficially
own, directly or indirectly, shares of Common Stock on a fully-diluted basis (as
defined in Section 4.1(a) above) which exceed the Relevant NMR Ownership Level
at that time. For purposes hereof, the term "Relevant NMR Ownership Level" shall
mean the number of shares of Common Stock actually issued to and held by NMR as
of a relevant measurement date (which, for the avoidance of doubt, shall include
the shares of Common Stock issuable upon conversion of the Series Preferred held
by NMR but shall not include the shares of Common Stock underlying the NMR
Warrants until such NMR Warrants are actually exercised in whole or in part). As
of the date hereof, the Relevant NMR Ownership Level is 3,288,755 shares.
(b) The Stockholders agree not to transfer any Company Securities
owned by them to any non-Affiliate of such Stockholder if, as a result of such
transfer, the restrictions contained in this Section 4.2 would be violated as a
result thereof. The Company shall not register on the stock transfer books of
the Company, or otherwise recognize or give effect to, any transfer or purported
transfer by any Stockholder in violation of this Section 4.2.
(c) The restrictions contained in this Section 4.2 shall lapse upon
the effectiveness of the registration statement relating to a Company-IPO.
8
4.3 STANDSTILL PROVISIONS. (a) Subject to the remaining provisions of
this Section 4.3, NMR, TCI, ACN and their respective Affiliates (the "Restricted
Parties") shall not, directly or indirectly, acquire beneficial ownership of any
Voting Stock (as hereinafter defined), any securities convertible into or
exchangeable for Voting Stock or any other right to acquire Voting Stock without
the prior written consent of the Company (following the approval thereof by a
majority vote of the Company's Board of Directors), if the effect of such
acquisition would be to increase the Voting Power (as hereinafter defined) of
all Voting Stock then owned by such Restricted Party, or which such Restricted
Party has a right to acquire, to an amount greater than the total Voting Power
of such Restricted Party as of the date hereof (without regard to any decrease
in such Voting Power occurring after the date hereof). The foregoing
restrictions shall lapse (i) with respect to all Restricted Parties, upon the
effectiveness of the registration statement relating to a Company-IPO and (ii)
with respect to NMR, TCI or ACN, at such time as NMR and its Affiliates, TCI and
its Affiliates or ACN and its Affiliates, as applicable, cease to beneficially
own at least 5.0% of the issued and outstanding shares of Common Stock on a
fully-diluted basis (as defined in Section 4.1(a) above).
(b) With respect to each of the Restricted Parties, any increase in
the Voting Power of such Restricted Party as a result of the following events
shall be disregarded for purposes of this Section 4.3:
(i) any stock dividends, stock splits or other distributions of
securities made to holders of any class of Voting Stock;
(ii) any stock repurchases or stock buy backs effected by the
Company, any recapitalization of the Company or any other action
taken by the Company or its Affiliates;
(iii) any purchases of Voting Stock effected by such Restricted
Parties pursuant to the first refusal rights granted to them
under the Restated Stockholders Agreement or pursuant to the
rights to purchase their "Pro Rata Portion" of "New Securities"
(as those terms are defined in the Restated Rights Agreement)
granted under the Restated Rights Agreement; and
(iv) any issuances of Voting Securities to directors, officers and
management personnel pursuant to compensatory plans of the
Company.
(c) Further, with respect to NMR and its Affiliates, any increase
in the Voting Power of such parties as a result of the following events shall be
disregarded for purposes of this Section 4.3:
(i) the exercise by NMR of all or any portion of the First Warrant
and the Second Warrant;
(ii) the exercise by NMR of its right to purchase up to 54% of the
issued and outstanding shares of the Company on a fully-diluted
basis (as defined in Section 4.1(a) above) pursuant to Addendum
No. 1 to Restated Rights
9
Agreement of even date among the Company and certain of the
Stockholders; and
(iii) the exercise by NMR of its rights under Section 4.3(d) below.
(d) Notwithstanding anything to the contrary in the foregoing or any
other provision of this Addendum, NMR shall have the right, from time to time
and without the prior consent of the Company, to make offers to purchase all
Company Securities held by the holders of all classes of Company Securities on
terms and conditions which are the same for all such holders, in each case as
part of an NMR Buyout Event proposed by NMR.
(e) As used in this Agreement, (A) the term "Voting Stock" means the
Common Stock, Preferred Stock and any other securities issued by the Company (or
reserved for issuance pursuant to the Company's employee stock option plan or
plans) having the ordinary power to vote in the election of directors of the
Company (other than securities having such power only upon the happening of a
contingency) and (B) the term "Voting Power" with respect to any Voting Stock
means the number of votes such Voting Stock is entitled to cast for the election
of directors of the Company at any meeting of shareholders of the Company (other
than votes that may be cast only upon the happening of a contingency). For the
avoidance of doubt, the parties acknowledge and agree that the total Voting
Power beneficially owned by NMR as of the date hereof is 3,293,799 shares, the
total Voting Power beneficially owned by TCI as of the date hereof is 4,020,579
shares and the total Voting Power beneficially owned by ACN as of the date
hereof is 3,882,013 shares. For purposes of this Agreement, the Restricted
Parties shall not be deemed to have beneficial ownership of any Voting Stock
held by a pension plan or other employee benefit program of NMR if NMR does not
have the power to control the investment decisions of such plan or program.
4.4 COMPETITIVE TAKEOVER OF NMR.
(a) The following provisions shall apply if a Competitive Takeover
occurs with respect to NMR but shall cease to apply after the effectiveness of
the registration statement relating to a Company-IPO or such time as NMR and its
Affiliates cease to beneficially own at least 5.0% of the issued and outstanding
shares of Common Stock on a fully-diluted basis (as defined in Section 4.1(a)
above). Upon completion of a Competitive Takeover, NMR shall give written notice
of such completion to the Company. For a period of 45 days after its receipt of
such notice, the Company shall have the right, exercisable by written notice
given to NMR within 10 days of its receipt of such notice from NMR, to
repurchase from NMR all, but not less than all, of the Company Securities
(including, without limitation, the NMR Warrants) then beneficially owned by
NMR, provided within 30 days after submitting such written notice to NMR, NRI
shall provide NMR with evidence reasonably satisfactory to NMR (by written
commitment letter from a financing institution subject only to customary
borrower representations, due diligence and documentation, letter of credit or
otherwise) of its ability to finance and complete such purchase.
(b) The purchase price shall be payable in full in cash at the closing
of such repurchase, and shall be determined based upon the Appraised Value of
the Company. NMR and the Company shall each select an investment banking firm of
national reputation to determine the
10
Appraised Value of the Company and such Appraised Value, to the extent
practicable, shall be determined (A) if two investment banking firms are
appointed pursuant to Section 1.2(i) within 45 days of their appointment, and
(B) if a third investment bank is appointed in accordance with Section 1.2(ii),
within 30 days of the appointment of such third investment banking firm. The
parties shall promptly provide, at their own cost and expense, such documents,
data and other assistance as may be reasonably requested by such investment
banking firms in order to expedite, to the extent reasonably possible, their
determination of the Appraised Value of the Company. The fees and expenses of
all such investment banking firms shall be borne by the Company. The closing of
such repurchase shall occur not more than 110 days after the repurchase notice
submitted by the Company as set forth above or as soon thereafter as practicable
to the extent necessary in order to comply with all regulatory filings and
clearances. If the Company does not submit a repurchase notice to NMR within 45
days after its receipt of a takeover notice from NMR as aforesaid (or if the
Company shall fail to provide evidence of its ability to finance the purchase
within 30 days of its election notice to NMR as aforesaid), the Company shall be
deemed to have irrevocably waived its rights under Section 4.4(a).
(c) If the Company elects to exercise its repurchase rights under this
Section 4.4, the Company shall have the right to specify, after presentation of
evidence of its ability to finance such repurchase as required under Section
4.4(a) above, another person or persons as its designee(s) to purchase the
shares which it has elected to purchase hereunder; provided, however, that the
Company shall be legally obligated to complete any such purchase if any of its
designee(s) fail to do so.
(d) NMR shall make customary representations and warranties as to its
ownership of the shares sold to the Company hereunder and the lack of any liens
or encumbrances created by NMR with respect thereto. NMR shall make no other
representations and warranties to the Company in connection therewith.
(e) As used herein, a "Competitive Takeover" shall be deemed to mean
and include (i) a merger or consolidation to which NMR is a party if Media
Metrix (and any Affiliate or successor) has beneficial ownership (as defined in
Rule 13d-3 under the Securities Exchange Act of 1934 (the "Exchange Act") of
more than fifty percent (50%) of the total combined voting power for election of
directors of the surviving corporation following the effective date of such
merger or consolidation; (ii) the acquisition of direct or indirect beneficial
ownership (as defined in Rule 13d-3 under the Exchange Act) in the aggregate of
securities of NMR representing fifty percent (50%) or more of the total combined
Voting Power of NMR's then issued and outstanding Voting Stock by Media Metrix
(and any Affiliate or successor) as shown on a Schedule 13D filed with the SEC
pursuant to the Exchange Act; or (iii) the sale of all or substantially all of
the assets of NMR to Media Metrix (and any Affiliate or successor).
4.5 TRANSFER OF RIGHTS.
(a) The rights and restrictions applicable to NMR under this Addendum
shall not be transferable to any purchaser or transferee of any Company
Securities owned by NMR unless such transfer is consented to in advance by the
Company. Notwithstanding the foregoing, the rights and restrictions applicable
to NMR hereunder may be sold or transferred to NMR without the prior consent of
the Company (i) to any Affiliate of NMR or (ii) to any successor or
11
transferee (whether by merger, sale of assets or otherwise) of the operations,
business and assets of NMR.
(b) Notwithstanding the foregoing, NMR shall not have the right to
sell or transfer any Company Securities beneficially owned by it to any of the
persons listed on EXHIBIT C hereto without the prior written consent of the
Company.
(c) The restrictions contained in this Section 4.5 shall cease to
apply upon effectiveness of the registration statement relating to a Company-IPO
or of such time as NMR and its Affiliates cease to beneficially own at least
5.0% of the issued and outstanding shares of Common Stock on a fully-diluted
basis (as defined in Section 4.1(a) above).
4.6 CERTAIN FURTHER RESTRICTIONS. Until the earlier of (i) the
effectiveness of the registration statement relating to a Company-IPO and (ii)
the date on which NMR and its Affiliates cease to beneficially own at least 5.0%
of the issued and outstanding shares of Common Stock on a fully-diluted basis
(as defined in Section 4.1(a) above), NMR hereby undertakes the following
additional restrictions:
(a) Except as consented to by the Company in writing, NMR shall not
deposit any shares of Company Securities beneficially owned by it in a voting
trust or, except as otherwise provided in this Addendum or in any other
agreement between the Company and the Stockholders, subject any such shares to
any arrangement or agreement with respect to the voting of such shares.
(b) Without the prior written consent of the Company, NMR shall not
initiate or participate in the solicitation of proxies with respect to any
Company Securities, nor shall it become a "participant" in any "election
contest" as such terms are used in Rule 14a-11 of Regulation 14A under the
Exchange Act (whether or not the shares of the Company are subject to such
regulations) relating to the election of directors of NMR; provided, however,
that any NMR Director shall not be deemed to be a "participant" solely by reason
of the membership of such designee on the Board of Directors of the Company, and
NMR may exercise its influence on the management, Board of Directors, plans and
policies of the Company in a manner consistent with its share holdings, the
fiduciary duties of its designee or designees on the Board of Directors of the
Company, and any business agreements between NMR and the Company.
(c) Except with regard to permissible purchases of Company Securities
by NMR or permissible sales of Company Securities beneficially owned by NMR, NMR
shall not form or join any group, as defined in Rule 13d-3 under the Exchange
Act, for the purpose of acquiring, holding or disposing of Company Securities or
initiate or pursue, a tender or exchange offer or other change of control of the
Company.
4.7 EXCEPTIONS. Nothing in this Article IV or in any other provision of
this Addendum shall be deemed to restrict NMR's ability to exercise its rights
under the NMR Warrants and to exercise its rights to purchase Company Securities
under the Second Restated Rights Agreement (and Addendum No. 1 thereto) and the
Second Restated Stockholders Agreement (and this Addendum No. 1 thereto,
including, without limitation, its rights granted to NMR under Section 4.3
hereof).
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ARTICLE V
GENERAL PROVISIONS
5.1 GOVERNING LAW. This Agreement shall be governed by the laws of the
State of California without regard to choice of law provisions thereof, and by
the General Corporation Law of the State of Delaware to the extent applicable to
any corporate action related to the Company.
5.2 ENTIRE AGREEMENTS. This Agreement and the Second Restated
Stockholders Agreement constitute the entire agreement among the parties with
respect to the subject matter hereof and supersedes all prior oral or written
agreements and understandings between them or any of them as to such subject
matters.
5.3 AMENDMENT. Except as otherwise expressly provided herein, this
Agreement may be amended only upon the written consent of the Stockholder
against whom this Agreement is sought to be enforced, the Company, and Investors
representing not less than a majority-in-interest of each class of Series
Preferred then held by the Investors.
5.4 SUCCESSORS. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective heirs, executors, legal
representatives, successors, and permitted transferees, except as may be
expressly provided otherwise herein.
5.5 INVALIDITY OF PROVISIONS. In the case any one or more of the
provisions contained in this Agreement shall for any reason to be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement and such
invalid, illegal and unenforceable provision shall be reformed and construed so
that it will be valid, legal, and enforceable to the maximum extent permitted by
law.
5.6 NOTICE. All notices and other communications required or permitted
under this Agreement shall be mailed by registered or certified mail, postage
prepaid, or otherwise delivered by hand or by messenger, addressed (a) if to a
Stockholder or Investor, at such Stockholder's or Investor's address as such
Stockholder or Investor shall have furnished to the Company in writing, or (b)
if to the Company, one copy should be sent to its offices and addressed to the
attention of the President, or at such other address as the Company shall have
furnished to the Investor.
(b) Each such notice or other communication shall for all purposes of
this Agreement be treated as effective or having been given when delivered if
delivered personally, or, if sent by mail, at the earlier of its receipt or 72
hours after the same has been deposited in a regularly maintained receptacle for
the deposit of the United States mail, addressed and postage prepaid as
aforesaid.
5.7 NO WAIVER. Any party's failure to enforce any provision or
provisions of this Agreement shall not in any way be construed as a waiver of
any such provision or provisions, nor prevent that party thereafter from
enforcing each and every other provision of this Agreement. The rights granted
to the parties herein are cumulative and shall not constitute a
13
waiver of any party's right to assert all other legal remedies available to it
under the circumstances.
5.8 CONSIDERATION. The Stockholders agree upon request to execute any
further documents or instruments necessary or desirable to carry out the
purposes or intent of this Agreement.
5.9 ADDITION OF PARTIES. The Company agrees that until the termination
of this Agreement, it will cause each person who acquires or beneficially owns
100,000 or more shares of Common Stock, to enter into this Agreement and thereby
to be bound by the terms hereof, all by execution of an instrument of accession
in appropriate form. Any such person so entering into this Agreement shall be
deemed to be a Stockholder for purposes of this Agreement.
5.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
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(b) The foregoing Addendum No. 1 to Restated Stockholders Agreement is
hereby executed as of the day and year first written above.
"COMPANY" NETRATINGS, INC.,
a Delaware corporation
By:
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▇▇▇▇▇ ▇. ▇▇▇▇, President
"INVESTORS" HITACHI, LTD.
By:
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Name:
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Title:
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TRANS COSMOS U.S.A. INC.
By:
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Name:
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Title:
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▇▇▇▇▇▇▇ MEDIA RESEARCH INC.
By:
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Name:
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Title:
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▇▇ ▇▇▇▇▇▇▇ CORPORATION
By:
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Name:
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Title:
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"INVESTORS" (CON'T)
SWISS FAMILY ▇▇▇▇▇ LIMITED
By:
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▇▇▇▇▇ ▇▇▇▇
Title:
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Ling Chow ▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Liangfu Fan ▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, III ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇
KINETECH, INC.
By:
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Title:
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇▇
"STOCKHOLDERS" By:
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Name:
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By:
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Name:
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By:
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Name:
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By:
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Name:
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By:
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Name:
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By:
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Name:
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By:
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Name:
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By:
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Name:
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